Report: Data privacy hindering cloud adoption in Europe

Now that a large number of cloud-based services have been available on the market for several years, the adoption of the technology is approaching a global scale as businesses around the world leverage innovative solutions to improve efficiency and cut costs. However, not all companies will implement the cloud with as much haste as others.

According to a new report by research firm Gartner, European businesses will trail American corporations in cloud computing adoption rates by approximately two years. While there are many reasons for this trend, the most noticeable is the evolving data privacy regulations throughout the continent.

Meeting compliance requirements has always been an inhibitor to the cloud, but doing so takes on a different meaning in Europe, namely because of legal variations between the continent's 44 countries, Gartner said. These differences are compounded when a company's reach extends beyond a single country's borders, making cloud computing a major concern for business-to-business organizations or large multicountry enterprises.

"The opportunities for cloud computing value are valid all over the world and the same is true for some of the risks and costs," Gartner vice president Paolo Malinverno said. "However, some of cloud computing's potential risks and costs – namely security, transparency and integration – which are generally applicable worldwide, take on a different meaning in Europe."

Another widely recognized European inhibitor to the cloud is the struggling economy and weakening euro, Gartner analysts noted. The uncertainty of the euro's value has caused businesses of all sizes to put major IT investments on hold, including the cloud. While data security is sometimes an issue for organizations to deploy new solutions, the lack of funds makes it virtually impossible for decision-makers to purchase new technologies.

In addition to these concerns, many European Union (EU) policies take a long time to go into effect, diminishing the effect of quickly deploying the cloud and other IT services. Generally, the EU will establish overlying principles, which are then worked into the legislation of each member state. This process often takes considerable time, especially when governments make additions to EU-level policies, Gartner said.

According to a separate report by service provider Alcatel-Lucent, another major inhibitor to cloud adoption among the private sector is performance issues, often associated with data protection, end-to-end availability and response time. The study found that two-thirds of IT decision-makers have yet to move mission-critical applications to the cloud because of concerns over outages.

These worries are apparently reasonable, as two out of five respondents reported experiencing frequent or prolonged cloud service outages. Another 46 percent of respondents said current cloud delays are unacceptable and hurt business efficiency and employee productivity.

However, the Alcatel-Lucent study also found that decision-makers are optimistic in the cloud's ability to resolve these issues, as 44 percent of survey respondents plan on increasing cloud investments in the next three years. By creating thorough service-level agreements, organizations can be better prepared for cloud issues and understand who is responsible for any vulnerabilities that crop up: the user or the provider.

"The bottom line is that the interest in cloud is as high in Europe as it is elsewhere in the world," Gartner fellow David Smith said. "While these inhibitors will certainly slow down cloud adoption in Europe, they will not stop it – the potential benefits of cloud are too attractive and the interest in its efficiency and agility are too strong to stall it for long."